The red pill and blue pill are metaphorical terms representing a choice between learning an unsettling or life-changing truth by taking the red pill or remaining in the unquestioned experience of an illusion appearing as ordinary reality with the blue pill. The pills were used as props in the 1999 film The Matrix.

Historians of film note that the trope of a "red pill" as decisive in a return to reality made its first appearance in the 1990 film Total Recall, which has a scene where the hero (played by Arnold Schwarzenegger) is asked to swallow a red pill in order to symbolize his desire to return to reality from a dream-like fantasy, though this is presented as a deception and the pill's actual effect remains ambiguous.

In the film The Matrix, the main character Neo (played by Keanu Reeves) is offered the choice between a red pill and a blue pill by rebel leader Morpheus (played by Laurence Fishburne). Morpheus says "You take the blue pill... the story ends, you wake up in your bed and believe whatever you want to believe. You take the red pill... you stay in Wonderland, and I show you how deep the rabbit hole goes." It is implied that the blue pill is a sedative that would cause Neo to think that all his most recent experiences were a hallucination, so that he can go back to living in the Matrix's simulated reality. The red pill, on the other hand, serves as a "location device" to locate the subject's body in the real world and to prepare them to be "unplugged" from the Matrix.

In a 2012 interview, Matrix director Lana Wachowski said:

What we were trying to achieve with the story overall was a shift, the same kind of shift that happens for Neo, that Neo goes from being in this sort of cocooned and programmed world, to having to participate in the construction of meaning to his life. And we're like, "Well, can the audience go through the three movies and experience something similar to what the main character experiences?" So the first movie is sort of classical in its approach. The second movie is deconstructionist, and it assaults all of the things that you thought to be true in the first movie, and so people get very upset, and they're like "Stop attacking me!" in the same way that people get upset with deconstructionist philosophy. I mean, Derrida and Foucault, these people upset us. And then the third movie is the most ambiguous because it asks you to actually participate in the construction of meaning...

— Lana Wachowski, Movie City News, October 13, 2012

In the 2021 film The Matrix Resurrections, the Analyst uses blue pills to keep Neo's true memories suppressed in the guise of therapy sessions. Later, Neo takes another red pill before being freed from the Matrix once again by Bugs and her crew. In Trinity's case, she does not have to take the red pill again because of the way that Sati is freeing her from the Matrix. The red pills also allow friendly programs to leave the Matrix, as seen with the program version of Morpheus.

Philosopher and critic Russell Blackford questions whether a fully informed person would take the red pill and stay in the real world, arguing that the choice of physical reality over a digital simulation is not so beneficial as to be valid for all people. Both Neo and another character, Cypher (Joe Pantoliano), take the red pill over the blue pill, though later in the first Matrix film, Cypher demonstrates regret for having made that choice, saying that if Morpheus had fully informed him of the situation, Cypher would have told him to "shove the red pill right up [his] ass." When Cypher subsequently makes a deal with the machines to return to the Matrix and forget everything he had learned, he says, "Ignorance is bliss." Blackford argues that the Matrix films set things up so that even if Neo fails, the taking of the red pill is worthwhile because he lives and dies authentically. Blackford and science-fiction writer James Patrick Kelly feel that The Matrix stacks the deck against machines and their simulated world.